25/06/2017
The Week Ahead: 5 Things to Watch on the Economic Calendar
1. ECB's "Forum on Central Banking"
The fourth annual European Central Bank "Forum on Central Banking" is scheduled to take place in Sintra, Portugal from Monday to Wednesday. It will focus on investment and growth in advanced economies.
During two days of sessions and panels, approximately 150 central bank governors, academics, financial journalists and high-level financial market representatives will exchange views on current policy issues and discuss the chosen topic from a longer-term perspective.
ECB President Mario Draghi and Former Federal Reserve Chair Ben Bernanke will open the Forum with dinner speeches on Monday. Draghi is due to speak again Tuesday morning.
The highlight of the summit is likely to be Wednesday's panel discussion including Draghi, Bank of England Governor Mark Carney, Bank of Japan Governor Haruhiko Kuroda and Bank of Canada Governor Stephen Poloz.
Market players will look for any clues on the timing of when the world's biggest central banks plan to start winding down their monetary stimulus and begin normalizing policy.
2. Fed Chair Yellen Speaks
Federal Reserve Chair Janet Yellen is due to speak about global economic issues at the British Academy's 2017 President's Lecture in London at 1:00PM ET (1700GMT) on Tuesday. Audience questions are expected.
Her comments will be monitored closely for any new insight on policy and the timing of when the Fed will next raise interest rates. The Fed chair could be asked about the U.S. central bank's plan to start shrinking its massive balance sheet, which ballooned to $4.5 trillion in wake of the financial crisis.
Besides Yellen, a pair of Fed policymakers are due to make public appearances on Tuesday that may offer further insight into the debate among policymakers on the likelihood of higher interest rates in the months ahead.
Philadelphia Fed President Patrick Harker is set to speak about the economic outlook and international trade at the European Economics & Financial Centre, in London, while Minneapolis Fed Chief Neel Kashkari will speak at a town hall event in Michigan.
The Fed raised interest rates for the second time this year earlier in June and maintained plans to go ahead with another rate hike by year-end. Despite the Fed's message, market players remained doubtful over the central bank's ability to raise rates as much as it would like in the coming months due to softening inflation.
Futures traders are pricing in less than a 15% chance of a hike at the Fed's September meeting, according to Investing.com’s Fed Rate Monitor Tool. Odds of a December increase was seen at about 35%.
3. U.S. 1st Quarter GDP - Third Estimate
The U.S. is to release final figures on first-quarter economic growth at 8:30AM ET (1230GMT) Thursday. The data is expected to show that the economy expanded at a 1.2% annual rate in the first three months of 2017, unchanged from a preliminary estimate.
Besides the GDP report, this week's calendar also features U.S. data on durable goods orders, consumer confidence, pending home sales, weekly jobless claims as well as personal income and spending, which includes the personal consumption expenditures inflation data, the Fed's preferred metric for inflation.
Investors are likely to continue to fret over the latest headlines coming out of Washington for any new fallout from the investigation into the Trump campaign's possible ties to Russia.
The deepening turmoil surrounding President Donald Trump's administration intensified doubts that he would be able to follow through on his campaign promises for tax cuts, deregulation and fiscal stimulus.
4. Euro Zone Flash Inflation Figures
The euro zone will publish flash inflation figures for June at 0900GMT (5:00AM ET) Friday.
The consensus forecast is that the report will show consumer prices rose 1.2%, slowing from a gain of 1.4% in May, while core prices are expected to increase 1.0%, inching up from a rise of 0.9% in the prior month.
Germany, France, Italy and Spain will produce their own CPI reports throughout the week.
In addition to the inflation data, the Ifo economic institute will produce monthly data on German business morale for June.
Earlier this month, the ECB closed the door on more interest rate cuts, judging the bloc's economy to be rebounding, but said inflation looks to remain weak for years so it still needs to keep extraordinary stimulus in place.
5. Chinese Manufacturing Data
The China Federation of Logistics and Purchasing is to release data on June manufacturing sector activity at 0100GMT on Friday, amid expectations for a modest decline to 51.0 from 51.2 in the preceding month.
Anything above 50.0 signals expansion, while readings below 50.0 indicate industry contraction.
